NEW YORK: US Treasuries were steady on Wednesday before the government is due to sell $20 billion in 10-year notes, the second sale of $56 billion in new coupon-bearing supply this week.
With no major economic releases due this week, investors are focused on Treasury supply and next week's Federal Reserve meeting, when the US central bank is expected to leave interest rates unchanged.
Traders have pushed back rate-hike expectations to September at the earliest, after Friday's jobs report for May showed that employers added only 38,000 positions in the month, the smallest gain since September 2010.
A $24 billion auction of three-year notes on Tuesday showed relatively soft demand as indirect buyers, which include asset managers and other investors, reduced their participation.
"The three-year auction was a little soft, which was a big surprise, I think, because people figured there would be a better indirect bid, specifically coming out of Europe," said Dan Mulholland, head of Treasuries trading at Credit Agricole in New York.
That does not necessarily indicate that demand will not be strong for Wednesday's 10-year note sale.
"There seems to be pretty good demand for the long-end and the 10-year especially," said Mulholland.
Benchmark 10-year notes were last unchanged in price to yield 1.713 percent. The yields have risen from two-month lows of 1.697 percent on Friday, after the weak jobs report.
Traders expect the new notes to price at yields of 1.721 percent, according to the "when-issued" market.
The government will also sell $12 billion in 30-year bonds on Thursday.
US bonds were also supported by continuing strength in German government debt, whose yields hit a record low on Wednesday, pushing 10-year notes closer to negative territory.
German bunds have been supported by concerns about Britain's referendum on European Union membership and the European Central Bank's commencement of its corporate bond purchase program.